4 Penny Stocks Heating Up Late Friday Afternoon
Monday marks the start of the final trading week in January & we’re sure to see plenty of penny stocks on the watch list. I get that the weekends can be a boring time for many traders, especially if you’re new. Because so many of these cheap stocks have exploded this month, anticipation for what’s next is high, for sure. I think one of the glaring indicators suggesting big momentum in small-caps recently has been the Russell 2000 Small-Cap ETF (IWM).
Take a look at Friday’s session. We saw the S&P ETF (SPY) and the Invesco NASDAQ ETF (QQQ) both make attempts at rebounding from lows. While they did, in fact, bounce from intra-day lows, neither experienced the rally that the IWM did. Breaking it down to the numbers, the SPY closed 0.27% above its low, the QQQ closed 0.21% higher, but the IWM managed a rebound of 2.6% after hitting its low of $209.54 Friday morning.
Does Volume Also Suggest Momentum For Penny Stocks This Week?
Something else we discuss is volume. Many of the high volume penny stocks last week were heavily traded due to the increased trading activity in the market. In many cases, traders look for stocks with increasing volume to suggest a stronger trend. Similarly, we can look at the volumes of these benchmark ETFs to see if there is a trend to note.
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For this, let’s compare volume from the beginning of last week to Friday’s volume. The SPY volume increased roughly 1.76% from Monday to Friday. QQQ actually saw a decrease in volume of just over 11% from Monday to Friday. But once again, we see that IWM outpaced both with an increase in volume of 25.6% between Monday’s and Friday’s volume.
|ETF||Vol. 1/19||Vol. 1/22||%Change|
I’m throwing a lot of numbers at you right now. But the bottom line I want to get at is small-cap stocks are clearly experiencing a larger change & boost in activity based on these numbers. Keeping this in mind, here are a few hot penny stocks to watch before Monday’s opening bell. All of them saw a surge in momentum after the close on Friday.
Hot Penny Stocks To Watch
- InVivo Therapeutics (NASDAQ: NVIV)
- Atossa Therapeutics (NASDAQ: ATOS)
- Express Inc. (NYSE: EXPR)
- Energous Corp. (NASDAQ: WATT)
We’ve got a nice mix of names on this list of penny stocks. Some are focused on tech, others are traditional retail, but the first few are biotech. In this regard, we’ve discussed the excitement in biotech penny stocks recently. It’s not only thanks to the attention brought by vaccine development but also by the fact that these stocks are some of the more actively traded, volatile names in the market. InVivo is an example of one. Since the Christmas holiday week, shares of NVIV stock have climbed by nearly 150% so far. Last week was one of the bigger weeks during that period as InVivo moved up more than 40% alone. Furthermore, Friday’s aftermarket session saw NVIV stock jump from the $1.40 close to $1.85.
One of the interesting things to note is that the company hasn’t been very vocal during this 150% move. In fact, the last formal update from InVivo came in October when the company announced closing a $15 million offering. The time between then and now has, however, seen some growing institutional interest. Bigger Capital Fund, L1 Capital, Sabby Management, and Lind Global have all filed Form 13G’s during the last few months.
Despite not having much news, medical stocks have been a recent focus for traders. InVivo specializes in therapies for chronic spinal cord injury and has been vocal on Twitter regarding its advancements. In its most recent tweet, the company focused on a recent interview with Nobel Prize Recipient Sir Richard Roberts, Ph.D., F.R.S. on spinal cord injury. Roberts is also a member of InVivo’s scientific advisory board, the board of directors, and chief scientific officer of New England BioLabs.
Another one of the active penny stocks to watch from Friday is Atossa Therapeutics. It’s been on our watch list for several weeks now as well. Since gapping down in early December, the ATOS stock price has climbed from around 90 cents to highs last week of over $2.06. First, why the drop? As we know, public companies use the markets to raise money. In this case, Atossa announced a $20 million offering but at a steep discount to the current trading levels at the time. December’s drop wasn’t a result of bad data or anything like that but simply the market’s reaction to a heavily discounted financing round.
However, with fresh capital in hand, Atossa continued executing its plan. The company targets breast cancer, more recently, COVID-19. The company has a Phase I study to see the efficacy of its drug, AT-301. This is a nasal spray that can be taken at home by those suffering from the coronavirus. Dosing is complete, and data output is expected this month. According to the company, its preliminary assessment is that AT-301 nasal spray was safe and well-tolerated in this study. Atossa explained that these results support advancing this program into a Phase 2 study. In December, the company submitted a pre-IND meeting request with the U.S. FDA.
Aside from the potential AT-301 results, Atossa plans to begin the initial clinical study of AT-H201 this quarter as well. This is the company’s treatment to improve compromised lung function for moderate to severely ill, hospitalized COVID-19 patients by inhalation. Atossa has already filed provisional patent applications on AT-H201 to treat COVID-19 patients and AT-301 to treat patients diagnosed with, or to prevent, COVID-19 via nasal spray.
Heading over to a different industry, Express Inc. saw a strong move late in the afternoon on Friday. Shares of EXPR jumped from around $1.20 during Power Hour to a closing price of $1.79. Shares continued trading higher during the aftermarket session to $2.77. It’s no secret that retailers like Express have been under fire, failing to recover from the pandemic fully. Furthermore, in the case of Express, the company hasn’t been the best at posting strong earnings results in the short-term.
However, the company has made strides to turn things around and bring in more liquidity to its balance-sheet to regain some footing in a “post-pandemic” world. Analysts have even started to get more bullish on the stock. B. Riley boosted its $1 price target to $1.50 this month. The firm currently has a Neutral rating on the stock. Last month we discussed this stock as a speculative case if the economy begins turning around and if vaccines begin to hit the market.
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It would appear that others are finding a similar approach to EXPR stock in light of the company’s recent moves to gain financial strength. We should also mention that heavily sold stocks are gaining more interest right now, thanks to the explosive move that GameStop made last week. These tend to see heavier short positions, and some traders are looking for stocks that could potentially “squeeze.” Was this why EXPR hit momentum scanners late on Friday, and will this trend continue Monday morning?
Finally, Energous Corp. continues catching the attention of traders in January. Since the end of the year last year, WATT stock has been in rally mode. On December 21st, its opening price was $1.75. Last week, shares reached a high of $3.47 and continued higher to $3.54 during after-hours trading.
If you’ve never heard of the company before, Energous focuses on wireless charging technology. In December, the company was granted a patent, “ELECTRONIC DEVICE WITH ANTENNA ELEMENTS THAT FOLLOW MEANDERING PATTERNS FOR RECEIVING WIRELESS POWER FROM A NEAR-FIELD ANTENNA,” which sparked the initial interest in WATT stock.
While speculation has focused on a potential EV application, the company has formally announced a focus on health-tech-related achievements. This month, Energous announced that the American Equus EQx VitalsSensor completed trials and is on track for availability in Q1 2021. This is a wirelessly charged equine health-tracking sensor built with Energous’ WattUp wireless charging 2.0 technology. The product is designed for the professional horseracing market. Whether or not this had anything to do with Friday’s move is yet to be seen. However, in light of the big move after-hours, WATT could be one of the penny stocks to watch before Monday’s opening bell.
Are Penny Stocks On Your List This Week?
Summing a few things up, there is a lot of momentum in small-cap stocks right now. Some of this momentum is purely from speculative trading. Why is this important to keep in mind right now? Whenever speculation or emotions are a bigger factor, so is volatility. With that, we can see big swings in stocks. Knowing this, I think it’s fair to say that a sound strategy will help keep you focused while other less-experienced traders buy on “hype” alone. Heading into the Monday session, these are just some of the more active after-market penny stocks trending on Friday.